Lean Impact - 2

Ann Mei Chang is a leading advocate for social innovation. Coming out of silicon valley after 20 years with Google, Apple, and Intuit, as well as at a range of startups, she became the Chief Innovation Officer at Mercy Corps and latterly, the Chief Innovation Officer at USAID. She recently released a book - Lean Impact which seeks to bring the best practices for innovation from the heart of Silicon Valley to the purpose of achieving radically greater social good.

I attended a recent talk given by Ann Mei and have split an abridged version into 2 blogs due to length. Part one is here. Ann Mei outlined three principles that she discovered. The first one is to think big and was covered by the first blog. She continues with the second and third ones:

Start Small.

And so once we set this kind of big, audacious goal, the temptation is to execute as fast as we can, right? Because there's people who are suffering today, who are in need today who could benefit. But the reality is that by starting small, I think in think in the long run we make a bigger difference because when we're working with a small number of people of ten or 20 or 50 people we can test and iterate and learn much, much faster and much, much more cheaply than we can if we're trying to run a huge organisation serving thousands of people.

Coming from Google into the world of global development one of the things that was big eye-opening experience for me is that how much people like to plan. We liked to create plans at US AID to design programmes that we put out in RFP and then the organisations that are bidding create their plans and then they win and then they create a work plan. And by the time you actually get a programme out into the world, actually touching real people's lives it can be years later. And so during that time, there's so much risk that we've built up. There's so many things that could go wrong. We're working in highly complex environments and highly complex entrenched problems. And so by the time you deliver something, there's huge risk and when you fail you fail really big and you've wasted a lot of time and money.

We're trying to tackle really complex challenges so we're going to fail. What we want to do instead, is to fail small, to identify the biggest risks, to test for them, and to get out into the field as quickly as possible to see what the reality is, to see how people really respond. And when we fail, we can then learn from that failure, improve what we're doing and get back up and try again and through that process of innovation, we can actually get to a much, much better solution.

So what this looks like is the classic build-measure-learn feedback loop and this is not rocket science. Essentially this is the entrepreneurial version of the scientific method. That you come up with a potential solution and you have a hypothesis of what's going to happen if you deploy your solution and what you do is you build an experiment that is sort of the simplest, cheapest experiment that will help you learn about that. You measure the results. You gather the data and then you learn. If your solution succeeded, then maybe you can double down on it. If it failed, then maybe you need to tweak it in some way or improve it in some way or maybe you need to pivot and take a different path altogether.

The trick here is how quickly we can iterate through this process. Again, we tend to run evaluations that may take a year or two years before we actually get any data about what's working. And so the key is how do we go for months or years around the cycle to days or weeks. Because the faster we go around the cycle, the faster we're going to learn, the faster we're going to improve and get to the best solution.

For social innovation, there's three dimensions on which we need to deliver for a successful solution and that's value, impact, and growth. So value is something that people not only want, but will demand and come back for and tell their friends about, fills a deeply held need. Impact is 'does it work?' Does it actually deliver the social benefit that we're seeking? And growth is if it works, can we get it to somewhere approximating the scale of the need to people who really can benefit.

Summit public schools is a non-profit in the U.S. that set out with a goal to educate a diverse student population and have a hundred percent of them graduate college. And so after eight years in operation, their first cohort graduated and they found that they were doing much better than industry average and so people were pressuring them to say this is a great success, you should scale. And yet, the founder, Diane, said, "We're doing great, but we're not at a hundred percent. We could do better." But she also realised she wasn't going to take another eight years to kind of improve the model and wait and see what would happen. That would just take too long.

So instead what they did was focus on building a culture of innovation and iteration into the organisation. And so they set up a platform on which they could gather weekly assessments on student academic progress. Focus groups on both teachers and students to see kind of how well students were engaging, what they were learning. And over the course of 57 weeks they ran week-long experiments modifying the kind of mix and duration and frequency of different types of lectures and self-paced learning and student projects and tutoring to see what would work.

And they came up with a revolutionary new approach to personalised learning that has now been adopted by over 300 public schools across the U.S. and their cohort last year, 99 percent of them were accepted to college and they're still waiting for them to graduate, but they were able to speed up this pace of learning in a domain where it usually takes a long time.

Vision Spring decided to focus on a 700 year-old invention that has been proved to increase productivity and learning potential and that's eyeglasses. And a lot of times we think of innovation as sort of some flashy whiz bang new thing, but this is a 700 year-old invention and yet estimates are that two and a half billion people who need eyeglasses still don't have them. And so Vision Spring set out to solve this problem.

They started out as many non-profits do in two geographies, in their case El Salvador and India, hired a bunch of vision entrepreneurs to do outreach, came back with compelling stories of kids who were able to learn, adults who weren't able to work anymore, be able to work again, and many non-profits. I mean this is a huge success. You know were making a huge difference, but it wasn't enough because they were losing money with every person they reached and they were never going to be able to scale.

And so the pivoted. Their first pivot was that they decided to set up vision centres in more urban areas to serve a more affluent population and take the profits there to do outreach in the more rural areas and through this they became financially self-sustainable. So they're doing good and they're financial sustainable. What could be better? Well, the problem was that it would take them decades, if not centuries, to be able to scale their infrastructure to get to everyone in the world and so they pivoted again.

They decided to work through partnerships. They partnered with a non-profit in Bangladesh called Rack that had a network of community healthcare workers across the countries and use their network to distribute eyeglasses. And through this partnership they've reach more than a million people, through additional partnerships they've now reached more than four and a half million people and yet, four and half million people sounds pretty good, but it's only a tiny, tiny fraction of two and a half billion.

And they recognised that this is really a systems problem that the markets were functioning well, governments were providing services to their citizens and so they set up a public-private partnership called the Eyeliance bringing together eyeglass manufacturers and local governments and non-profits to really look at how we change the system.

And an example of a early success is they signed an agreement with the government of Liberia to integrate vision services into their public healthcare and public school system. And you can now see that through this, it may spark being able to change the system to get to that two and a half billion people. And again, in this example, they set their eyes on this goal. They kept their eyes on that goal and it forced them to really look at what they were doing in the context that can fail and pivot to find a way that they might be able to make that degree of impact.

Relentlessly seeking impact is essentially the question of how do you get from starting small to get that big audacious goal and surprisingly we all too often get diverted from it. One of the reasons we get diverted is that we tend to fall in love with our solution louder than our problem. And what we need to do instead is fall in love with our problem. And what I mean by that is that we get excited about our new gadget, a cool technology, a private ownership on our custom design intervention and we forget about looking to see is this really the best solution for the problem. Are we moving the needle enough and are we more cost effective than others out there? Most non-profits don't even know how cost effective they are and if we don't know how can we optimise it, how can we really say we're the best?

And one of the problems is that we look at the wrong kinds of data. We look at vanity data - absolute numbers of things like the number of people we've reached, the number of dollars we raised or spent, but they tell you nothing about whether you're really being successful. You know you can reach a lot of people just cause you're good at raising money, but did you improve their lives? And even if you did improve their lives, could another organisation have done more with the same resources? What really matters is the innovation metrics around value, growth, and impact and these are usually at the unit level. And they talk about the adoption rate, the engagement rate, the conversion rate, the units costs, the success rate. And when you're able to optimise these metrics, they show progress over time and where you can compare and say whether your solution is really better than others that are out there.

And so I just want to wind up by saying I think we need to have a mindset shift. And the mindset shift is this, if you think about companies, their goals are to make profits. And by regulation, companies are required to maximise profits or maximise shareholder value. I would say any organisation that's mission driven, whether a non-profit or for profit or a foundation or an impact investment, we should hold ourselves to the same standard but in impact. We should require ourselves to maximise impact and not just deliver some impact. And what that means is that we need to be more audacious about our goals and we need to measure and optimise what we're really able to deliver along the lines of value, growth, and impact.

Think Big.
Be audacious in the difference you aspire to make, basing your goals on the size of the real need in the world rather than what seems incrementally achievable.

Start Small.
Between a desire to help people who are suffering today and pressure from funders to hit delivery targets, interventions often scale too soon. Starting small and staying small makes it far easier to learn and adapt—setting you on a path to greater impact over time.

Seek Impact.
Whether due to excitement, attachment, or the requirements imposed by a funder, we can become wedded to our intervention, technology, or institution. To make the biggest impact, fall in love with the problem, not your solution.